US inflation data release leads to Bitcoin’s drop below $68k
Bitcoin experienced a significant decline in response to the release of the U.S. consumer price index for March, which showed a 3.5% increase. The price of Bitcoin dropped to approximately $67,500 as a result. The Department of Labor reported that inflation rose by 0.4% on a monthly basis, exceeding the previous month’s figure. This marked the third consecutive month of rising inflation rates since January.
Following the publication of the inflation data, Bitcoin’s price fell below $68,000. This decline had already caused a wave of liquidations in future contracts, with liquidations totaling $311 million, primarily from long positions.
Currently, Bitcoin is trading at around $67,700, showing a slight recovery from its sharp decline. Trading volumes have increased by 7% to $35.6 billion in the past 24 hours.
The consumer price index is used to measure inflation, and when it reaches high levels, fiat currencies like the dollar lose their purchasing power. While some view Bitcoin as a safe haven for capital, the relationship between the CPI and Bitcoin’s price is not always straightforward due to the volatility of the digital asset market.
In late March, analysts at QCP Capital warned that Bitcoin could face a correction in the medium term due to the increasing inflation rates in the United States. They predicted a decrease in capital inflows into the spot Bitcoin ETF sector, which led to an “inadequate” drawdown in the asset price below $61,000.
Sources:
– Trading Economics
– CoinGlass
– CoinMarketCap
